MMA Capital Management Announces Hunt Exercise of Option to Acquire MGM
BALTIMORE, Oct. 5, 2018 /PRNewswire/ -- MMA Capital Management, LLC (NASDAQ: MMAC) ("MMA Capital" or "the Company") today announced that an affiliate of Hunt Companies, Inc. ("Hunt") has exercised Hunt's option as set forth in the Master Transaction Agreement dated January 8, 2018 between the Company and Hunt ("MTA") to take assignment of the Company's commitment to acquire the LIHTC business of Morrison Grove Management, LLC ("MGM") pursuant to the Purchase and Sale Agreement dated as of the 8th day of January, 2018 (the "MGM PSA"). As a result of the Company's assignment of the MGM PSA and Hunt's closing thereunder, the Company will recognize an increase in common shareholders' equity of approximately $14.2 million in the fourth quarter, or approximately $2.32 per share based on our diluted shares outstanding at June 30, 2018.
Michael Falcone, MMA Capital 's Chief Executive Officer stated, "As discussed in our filing for the second quarter, Hunt has now elected to exercise its option to take assignment of the MGM agreements and, subject to the terms of such agreements, has consummated the acquisition of the MGM LIHTC business. With this closing, we have recognized an estimated $14.2 million increase in additional GAAP common shareholders' equity and our 2018 full year financial statements will reflect the entirety of the gain from the January Hunt transaction. With this final element of the transaction completed we can transition our focus on the future investment opportunities available to the Company."
The assignment of the MGM PSA and Hunt's closing thereunder completes the Company's disposition of its LIHTC business. In connection with the closing, the Company completed a series of additional transactions completing the disposition of MGM related assets. Those additional transactions included the acquisition by Hunt from the Company of a $9.0 million senior loan for $9.4 million, a loan that we had previously acquired from an affiliate of MGM. In addition, the Company acquired $10.0 million in Hunt notes from the MGM principals, for $5.0 million in cash and $5.0 million in a Company note. This purchase has the effect of increasing the principal balance of the Company's existing note from Hunt from $57.0 million to $67.0 million. The Company note to the MGM principals is payable quarterly in arrears, bears an interest rate of 5.0% and has a varying amortization schedule that fully amortizes the note by its maturity date of January 1, 2026.
About MMAC
MMA Capital primarily invests in debt associated with real estate and infrastructure. MMA Capital is externally managed and advised by Hunt Investment Management, LLC, an affiliate of Hunt Companies, Inc. For additional information about MMA Capital Management, LLC (NASDAQ: MMAC), please visit MMA Capital's website at www.mmacapitalmanagement.com. For additional information about Hunt Investment Management, LLC, please see its Form ADV and brochure (Part 2A of Form ADV) available at https://www.adviserinfo.sec.gov.
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SOURCE MMA Capital Management, LLC
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